Does the FBI have the power to crash bitcoins?

notme

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Quote from: antimattercrusader on November 19, 2013, 12:46:24 PM

After they have the authority to liquidate the coins, most likley it will be done at a government auction to a private party - not sold on any exchange. There are policies/prodecures for government disposing of confiscated assets, and signing up at MtGox and selling coins for fiat and placing it in a bank account are not amoung those produeecures.

Whoever purchases the private keys for the Silk Road stash will probably not find it in their best interest to dump the coins and destroy the value of their new acquisition. Furthermore, even if they did that to "hurt" bitcoin, it would fail. Sure - the price would fall, but the coins would get eaten up quicky, especially once it becaome public knowledge what was happening - it'd just be a BTC firesale, and the price would quickly recover.

This represents a very minimal threat.

+1

antimattercrusader

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After they have the authority to liquidate the coins, most likley it will be done at a government auction to a private party - not sold on any exchange. There are policies/prodecures for government disposing of confiscated assets, and signing up at MtGox and selling coins for fiat and placing it in a bank account are not amoung those produeecures.

Whoever purchases the private keys for the Silk Road stash will probably not find it in their best interest to dump the coins and destroy the value of their new acquisition. Furthermore, even if they did that to "hurt" bitcoin, it would fail. Sure - the price would fall, but the coins would get eaten up quicky, especially once it becaome public knowledge what was happening - it'd just be a BTC firesale, and the price would quickly recover.

This represents a very minimal threat.

RodeoX

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The revolution will be monetized!

I think you guys are forgetting what it is the FBI does. Among the things they do not do is interfere with markets.

ErisDiscordia

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Imposition of ORder = Escalation of Chaos

Why would the FBI exchange all those Bitcoins for USD? They can have as many USD as they want, all they need to do is ask uncle Ben, or lately, aunt Janet.

If they have half a brain left, they'll keep them.

Actually I think it quite plausible that the main objective for the FBI was acquiring a large number of BTC for the US government, in one swoop, cheaply and the take down of SR is just a nice by-product for them. The breakout in terms of USD/BTC price led by china that followed could just be the Chinese government going "holy shit, the US has 100K+ Bitcoins, we need to buy some NOW".

Bitcopia

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FBI doesn't want to kill bitcoin. It's not a threat.

Centralized payment systems allow for more secure laundering.

NorbyTheGeek

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Quote from: alishawkat on November 19, 2013, 07:09:09 AM

Hey guys with all this hype going around is it possible that the FBI can crash the market by selling all the bitcoins they seized? (which is now worth 100+ mill ). It seems like it's in they're best interest to get rid of our anonymous currency. Are we a ticking time bomb? What are your guys opinions?

Thanks

During the U.S. Senate hearing yesterday, representatives from Treasury, Justice, and Secret Service set a tone that Bitcoin is a Good Thing^TM and that existing laws and regulations are sufficient at this time. With that said, I don't see how it would be in the FBI's best interest to "crash" Bitcoin.

Besides, the FBI can't do anything with that seized evidence until the trial is concluded.

qwertyGuy

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Quote from: alishawkat on November 19, 2013, 07:09:09 AM

Hey guys with all this hype going around is it possible that the FBI can crash the market by selling all the bitcoins they seized? (which is now worth 100+ mill ). It seems like it's in they're best interest to get rid of our anonymous currency.

They would just make other people wealthy when dumping 144.000 coins. Price would recover very fast.
I believe they will need run auction for the 144.000 coins after the trial to get as much USD as posible .

kehtolo

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Seizing evidence!

notme

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Quote from: granolageek on November 19, 2013, 12:00:49 PM

Quote from: Shermo on November 19, 2013, 07:21:58 AM

In terms of the FBI cashing out the silk road BTC, they can only do that once it has gone to trial and a verdict has been decided.

There is also circumstantial evidence that while they do have access to DPR's personal Bitcoins, and they have a dump of the disk with Silk Road's escrow wallet, they do not have the key to access it. Thus there is a good chance that those BTC are gone forever rather than in the US government's hands.

If they can't access them, how did they move them to this address that they publicly announced?
https://blockchain.info/address/1FfmbHfnpaZjKFvyi1okTjJJusN455paPH

granolageek

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Quote from: Shermo on November 19, 2013, 07:21:58 AM

In terms of the FBI cashing out the silk road BTC, they can only do that once it has gone to trial and a verdict has been decided.

There is also circumstantial evidence that while they do have access to DPR's personal Bitcoins, and they have a dump of the disk with Silk Road's escrow wallet, they do not have the key to access it. Thus there is a good chance that those BTC are gone forever rather than in the US government's hands.

Shermo

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Even if they did have a flaw / backdoor for SHA2, which is very unlikely, they would be mega retards for ever using it unless it was for a massive security issue. All your internet banking and tons of other things rely on it, if there was an exploit then all hell would break loose!

In terms of the FBI cashing out the silk road BTC, they can only do that once it has gone to trial and a verdict has been decided.

corebob

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Quote from: alishawkat on November 19, 2013, 07:09:09 AM

Hey guys with all this hype going around is it possible that the FBI can crash the market by selling all the bitcoins they seized? (which is now worth 100+ mill ). It seems like it's in they're best interest to get rid of our anonymous currency. Are we a ticking time bomb? What are your guys opinions?

Thanks

It seems unlikely that they could just sell it themself without consent from gov/banks etc. After all it is confiscated assets.

However, I believe they could render bitcoin useless by breaking the encryption.

alishawkat

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Hey guys with all this hype going around is it possible that the FBI can crash the market by selling all the bitcoins they seized? (which is now worth 100+ mill ). It seems like it's in they're best interest to get rid of our anonymous currency. Are we a ticking time bomb? What are your guys opinions?

Thanks

Topic: Does the FBI have the power to crash bitcoins? (Read 1538 times)